Our CEO, Rami Cassis, told City AM that concerns about a carried interest tax rise triggering an exodus of PE dealmakers from London have been overdone.
Rami threw his weight behind the Labour Government’s plans to bring carried interest in line with income tax, on the provision that partners who finance 10% of fundraising from their own capital were excluded. That carve-out would reward the managers taking genuine personal risk.
He argued that carried interest is not much different from a management bonus, which is already taxed at the income tax rate. This would make the existing treatment harder to justify.
Rewarding managers who invest their own money would encourage entrepreneurial behaviour and less financial engineering. It would push firms towards building genuine wealth rather than bolstering a company’s accounts.
His position closely tracked reports emerging from the Treasury, which had signalled it would protect managers with capital at risk. Reeves had already indicated in June that Labour would extend gentler treatment where fund managers put their own money on the line.
Read the full article at City AM here.
Featured image courtesy of Jamie Street via Unsplash.
